Which One of the Following Statements Is Correct

question 327

Multiple Choice

Which one of the following statements is correct?

• A) A negative net present value indicates that a project is acceptable.
• B) A profitability index that is less than 1.0 indicates that a project is acceptable.
• C) A project with a net present value of zero is earning exactly the required rate of return.
• D) When the internal rate of return is less than the required rate, the project should be accepted.
• E) If the accounting rate of return exceeds the required discount rate, the project should be accepted.

---

Definitions:

Time Utility

The economic value added to products or services by making them available at a convenient time for consumers when they are needed or wanted.

Dick's Sporting Goods

An American sporting goods retail company offering a wide range of sports equipment, apparel, and footwear.

Year-Round Inventory

Year-round inventory refers to the practice of maintaining a consistent stock of inventory throughout the year to meet demand without significant fluctuations.

Seasonal Sports

Sports activities that are played or take place primarily in certain seasons of the year, such as skiing in winter or baseball in summer.